New Zealand and India have struck a free trade agreement, the New Zealand government announced on Monday, a move aimed at making it easier for Kiwi exporters to access the world’s largest population and an economy projected to be worth NZ$12 trillion ($7 trillion) by 2030.
The agreement reduces or eliminates tariffs on 95% of New Zealand's exports to India, with more than half of the products set to be duty-free from day one, the government said. This is expected to improve access to India’s rapidly expanding middle class.
Christopher Luxon, Prime Minister of New Zealand, spoke with Prime Minister Narendra Modi following the conclusion of the deal.
"I’ve just spoken with India’s Prime Minister Narendra Modi following the conclusion of the NZ-India Free Trade Agreement," Luxon wrote on X.
Luxon added, "The FTA reduces or removes tariffs on 95% of our exports to India. It’s forecast that NZ exports to India could increase $1.1B to $1.3B per year over the coming two decades. Boosting trade means more Kiwi jobs, higher wages and more opportunities for hard working New Zealanders. The agreement builds on the strong friendship between our two countries. India is one of the fastest-growing economies in the world, and this gives Kiwi businesses access to 1.4 billion Indian consumers."
"Our Government is relentlessly focused on fixing the basics and building the future - with new trade deals like this helping to grow our economy so all Kiwis can get ahead," he tweeted.
No duty concessions by India on dairy sector for New Zealand
India has not given any import duty concessions in its dairy sector for New Zealand under the bilateral free trade agreement, an official said.
"The dairy sector is completely a red line for us. No duty concessions under the pact in the sector," the official said.
India has always resisted opening the door to bulk dairy imports in all of its previous pacts.
Dairy has long been the most sensitive, and politically charged issue in the negotiations.
New Zealand is one of the world's largest dairy exporters, while India is home to millions of small dairy farmers for whom market protection is a red-line issue. In practice, however, current trade is minimal.
New Zealand's dairy exports to India in FY2025 totaled just USD 1.07 million, consisting of milk and cream ( USD 0.40 million), natural honey (USD 0.32 million), mozzarella cheese (USD 0.18 million), butter (USD 0.09 million) and skimmed milk
With inputs from Reuters